Signs it's time to switch
Most owners don't switch over one bad month. They switch when the same problems keep coming back: statements that arrive late or don't tie out, calls and emails that go unanswered, residents complaining about slow repairs, units sitting vacant, and repair invoices with a markup you didn't agree to. If you have to chase your manager for basic answers, it's time to look.
Step 1: Read your current management agreement
Before you say anything to your current manager, find the signed agreement and look for:
- Notice period. 30, 60, or 90 days is common.
- How notice must be sent. Some agreements require certified mail or a specific address.
- Termination or cancellation fees. Know the number before you give notice.
- Leasing fees after termination. Some managers keep earning on leases they signed.
- Records and handover. What the manager must turn over, and by when.
If anything is unclear, have it reviewed before you send notice.
Step 2: Choose the new manager before you give notice
Line up the new manager first so there's no gap in rent collection or emergency coverage. Michigan requires a real estate broker license to manage property for others for a fee, so confirm the company's license on LARA's license search. Then ask each candidate for:
- Written service standards, such as response times and when statements arrive
- A sample monthly owner statement
- How they hold security deposits and operating funds
- How repairs are billed, and whether vendor invoices carry a markup
- The agreement term and what it takes to end it
Step 3: Give written notice and set a cutover date
Send notice exactly the way your agreement requires, and keep a copy. Pick a cutover date on the 1st of a month when you can, so one manager collects each month's rent and the first statement covers a full month. Ask the outgoing manager to confirm the handover date and the list of records in writing.
Step 4: Collect the records
Ask for everything below, in writing, with a date it will be delivered:
- Current rent roll, with lease start and end dates
- Resident ledgers and the delinquency report
- Signed leases, renewals, and addenda for every unit
- Security deposit list by unit (amount and where it is held) and move-in condition checklists
- Pending applications, scheduled move-ins, and notices to vacate
- Open work orders and the recurring maintenance schedule
- Vendor contracts, service agreements, and warranties
- Keys, fobs, and access, alarm, and gate codes
- Utility accounts and who each one is billed to
- Insurance certificates and any open claims
- Any eviction cases, court dates, or legal notices
- Owner ledger, bank statements, and year-to-date income and expenses
- Reserve or escrow balances and prepaid rent
- Vendor tax information for year-end 1099s
Step 5: Move the money, not just the records
Security deposits are residents' money, and Michigan's Security Deposit Act sets rules for how they are held and returned. When management changes, make sure the actual deposit funds move to the account the new manager will hold them in, and that the balance matches the list by unit.
Do the same for operating funds, prepaid rent, and reserves. Ask the outgoing manager for a final accounting through the cutover date, and don't sign off until the numbers tie out.
Step 6: Tell residents in writing
Residents should hear from you or the new manager before the first rent due date under new management. The notice should cover:
- Who to pay, how to pay, and the date it starts
- New maintenance and after-hours emergency contacts
- How to set up the new resident portal
- That their lease terms are not changing
Step 7: Reconcile in the first 30 days
The first month is where problems from the old manager surface. Tie the rent roll to the signed leases and the resident ledgers, check every deposit, walk and photograph the property, and build a renewal calendar so no lease ends without an offer. Your first statement should show exactly where things stood at cutover.
Switching from self-management works the same way. You are the outgoing manager, so the checklist above is what to have ready.